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Discussion Starter · #1 ·
This is an older article, bu I just recently found it. Sorry if this has been posted before.

Looks like GM is pushing for dealers to keep the price down. They are discouraging price gouging fro the sake of GM.

http://www.solsticemagazine.com/art...ome-good-news:-GM-may-have-a-hit-on-its-hands

Finally some good news: GM may have a hit on its hands
By Brett Clanton | Published 06/16/2005 | Hot Press | Email Print


GM Solstice Price Gouging
Jonathan Wollman confesses a bias for foreign cars. That's why the 41-year-old software developer from Los Angeles is surprised to find himself so smitten with the Pontiac Solstice, a sleek two-seater coming out this summer from General Motors Corp.

"I've never owned an American car," said Wollman, who wants to trade in his Mazda Miata. "But this is really a beautiful-looking car. It's enough to really make me consider it seriously."

He's not alone. GM's performance brand already has piled up 9,000 orders for the sporty ragtop, about half the number it had planned to build this year.

But instead of celebrating, Pontiac is quietly -- and delicately -- addressing complaints that its dealers are asking "well above" the $19,995 base sticker price for Solstice, according to a memo sent to Pontiac's 2,700 U.S. dealers and obtained by The Detroit News.

The letter underscores how much is riding on the Solstice for GM, which is reeling after a $1.1 billion first-quarter loss and is counting on new models to lift sales. It also highlights the tension that sometimes develops between automakers and dealers over how to sell particular models.

The practice, while within the dealers' rights, is angering some customers who were wooed by the vehicle's low price tag, and could sour customers' experience with Pontiac for years, the memo says.

"As you sell Solstices this year, please consider more than just the near term," said the letter signed by John Larson, the general manager of Buick, Pontiac and GMC, and Mark-Hans Richer, Pontiac's marketing director. "We are at a critical point in Pontiac's resurgence and encourage a long-term perspective of the total Pontiac opportunity."

But industry analysts say inflated dealer pricing on Solstice is a problem of GM's making. The automaker ran the first ad for the car in January during a college bowl game and has been running the ads since April after the Solstice appeared in NBC's reality program "The Apprentice." Yet the car is still not available in dealerships.

The ads have created pent-up demand for the Solstice and made it easier for dealers to play off the hype to boost prices, said Mike Chung, an auto pricing and market analyst with Edmunds.com in Santa Monica, Calif.

"Now, the buzz has literally come back to haunt them," he said.

It is not uncommon for dealers to charge above sticker for a hot new model. In the 1980s, many Mazda dealers received more than $5,000 above sticker for another sporty roadster, the Miata. And some Chrysler dealers in 2000 charged above sticker when the PT Cruiser debuted. The fuel-sipping Toyota Prius hybrid also fetches sticker-beating prices.

But Pontiac contends that Solstice's $19,995 base price, including destination fees, is a crucial piece of its marketing efforts and that the rebounding brand cannot risk alienating buyers with inflated prices. Fully loaded, the vehicle is about $25,000.

"We are asking you to show leadership in the customer service and retail experience," GM officials told dealers, according to the memo. "All across the country, we have a unique opportunity to impress potential Solstice buyers, many of whom may have never considered Pontiac prior to this vehicle, let alone visited a Pontiac showroom."

Jim Hopson, a Pontiac spokesman, said the letter came in response to complaints about "a very few offenders" and that overcharging for the Solstice was not a widespread problem. And it has not deterred customers from seeking out the rear-wheel-drive roadster with the eye-catching curves, he said.

The strong early response to the Solstice has convinced Pontiac officials that a boldly designed vehicle can win back American car buyers who may have opted for Hondas and Toyotas in recent years. It could also help improve the image of the Pontiac brand. In March, GM Vice Chairman Bob Lutz described Pontiac as "damaged," along with Buick. The comment sparked speculation that Pontiac would soon be eliminated, a notion GM immediately debunked.

GM hopes the Solstice buzz spills over to other Pontiac models -- including the new G6 sedan and the upcoming Torrent midsize SUV -- and helps Pontiac rebound from a 17 percent sales decline this year.

"I don't see how it can do anything but help Pontiac," said Ed McDade, general sales manager at Ray Laethem Pontiac Buick GMC in Detroit.

McDade has taken 11 orders for the Solstice, but has resisted the urge to charge more than the price on the window, though the car appears to be his biggest hit in a while.

"Nobody likes to pay more than sticker," he said. "Although they are doing it on some of the competitors' cars, we try to avoid it."

Yet the temptation may grow stronger if new high-volume models perform below expectations or Pontiac is slow in replacing some aging models in the lineup.

The Solstice is scheduled to arrive in showrooms late this summer. But only a few customers will get them then. GM will first deliver the car to a group of 1,000 people who placed orders on April 15 in conjunction with "The Apprentice" TV show appearance. Then it will work on filling the remaining backlog of orders from dealers.

You can reach Brett Clanton at (313) 222-2612 or [email protected].
On the plus side, with the internet becoming more and more popular as a shopping tool for auto purcashes, it is becoming harder and harder for dealers to charge a significant markup. most consumers these days just won't settle for it.
 

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Chances are that the article, or a similar one was posted before, but I couldn’t find it quickly. So it can stay. Pricing may be a good topic of discussion at this point anyway since we are close to seeing deliveries.

I will move the thread to our news section. Thanks for sharing it!
 

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Discussion Starter · #3 ·
BTW...If anyone else hasn't noticed, SolsticeMagazine.com was a big flop :lol:.


There just is no competing with the KING :yesnod:

Love my Solsticeforum :)
 

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Liam1694u said:
BTW...If anyone else hasn't noticed, SolsticeMagazine.com was a big flop :lol:.


There just is no competing with the KING :yesnod:

Love my Solsticeforum :)
Kool, but I've also learned never to rest on your laurels, never listen to your own press, and never be smug. Taught to me by a great, now deceased old friend.
 

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Discussion Starter · #5 ·
solsticeman said:
Kool, but I've also learned never to rest on your laurels, never listen to your own press, and never be smug. Taught to me by a great, now deceased old friend.

Very nice... Very nice indeed...
 

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My Dealer

mceb said:
I sent that article to my dealer right after it went out. Their stance is to maintain charging the surcharge of $1000.00. I was told my the salesman, they can do as they wish. If I did not want the car that badly I would have demanded a return on my deposit. He has since bumped me from 6th to 4th on his first allocation.
 

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fak429 said:
I sent that article to my dealer right after it went out. Their stance is to maintain charging the surcharge of $1000.00. I was told my the salesman, they can do as they wish. If I did not want the car that badly I would have demanded a return on my deposit. He has since bumped me from 6th to 4th on his first allocation.
Just make sure to take your car across town to the other pontiac dealer (assuming you have a choice) for service.

AND TELL THEM ABOUT IT. Go on and on about how great the service is "over there".

If you have no choice, if/when you have service done, (especially warranty work), just make sure you give them the crappiest marks when you are asked to participate in any surveys, and explain in writing that you are still upset they gouged you $1000 and will never give them good marks because they apparently have a monopoly on the service aspect.

It's all in how you look at it - pi$$ off a customer now for an extra grand, pay later in crappy service scores.

AND go over your car with a fine toothed comb, mark down every little bit that is wrong with it (essentially everything they missed in the inspection they were supposed to do prior to giving you the car). Then write a nice letter to Pontiac telling them they apparently did not complete an inspection of your car properly.

OR, just write a letter to Pontiac directly, telling them you were ripped off by your Pontiac dealer. Or write the letter directly to Bob Lutz.

There's more than one way to play the game. ;)
 

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solsticeman said:
Just make sure to take your car across town to the other pontiac dealer (assuming you have a choice) for service.

AND TELL THEM ABOUT IT. Go on and on about how great the service is "over there".

If you have no choice, if/when you have service done, (especially warranty work), just make sure you give them the crappiest marks when you are asked to participate in any surveys, and explain in writing that you are still upset they gouged you $1000 and will never give them good marks because they apparently have a monopoly on the service aspect.

It's all in how you look at it - pi$$ off a customer now for an extra grand, pay later in crappy service scores.

AND go over your car with a fine toothed comb, mark down every little bit that is wrong with it (essentially everything they missed in the inspection they were supposed to do prior to giving you the car). Then write a nice letter to Pontiac telling them they apparently did not complete an inspection of your car properly.

OR, just write a letter to Pontiac directly, telling them you were ripped off by your Pontiac dealer. Or write the letter directly to Bob Lutz.

There's more than one way to play the game. ;)

That's awesome! I like the way you think Solsticeman. :thumbs:
 

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One day most dealers will realize that the sale is not where the money should be made. Great customer service will keep them coming back forever.
 

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I agree

:agree: I totally agree. I have lowered prices on items that I sale and am always extremely professional and nice. That is what has gotten me several return accounts.
 

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solsticeman said:
Just make sure to take your car across town to the other pontiac dealer (assuming you have a choice) for service.

AND TELL THEM ABOUT IT. Go on and on about how great the service is "over there".

If you have no choice, if/when you have service done, (especially warranty work), just make sure you give them the crappiest marks when you are asked to participate in any surveys, and explain in writing that you are still upset they gouged you $1000 and will never give them good marks because they apparently have a monopoly on the service aspect.

It's all in how you look at it - pi$$ off a customer now for an extra grand, pay later in crappy service scores.

AND go over your car with a fine toothed comb, mark down every little bit that is wrong with it (essentially everything they missed in the inspection they were supposed to do prior to giving you the car). Then write a nice letter to Pontiac telling them they apparently did not complete an inspection of your car properly.

OR, just write a letter to Pontiac directly, telling them you were ripped off by your Pontiac dealer. Or write the letter directly to Bob Lutz.

There's more than one way to play the game. ;)
Thanks Solisticeman, I will use another dealer for the service. I have contacted Jim Hopson from GM, and sent him the e-mail I received from the dealer answering my question concerning the surcharge. Letter to Mr. Lutz sounds good as well.
 

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"I've never owned an American car," said Wollman, who wants to trade in his Mazda Miata. "But this is really a beautiful-looking car. It's enough to really make me consider it seriously."
Is Wollman a member of the forum? Seems like we've got a number of Miata owner's and also a few So. Cal people.
 

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Thanks! Sometimes reposts are good, especially for the less tuned in (like me) ;D

Liam1694u said:
This is an older article, bu I just recently found it. Sorry if this has been posted before.
In my opinion, you did us all a favor by reposting it. I had not seen this, and probably never would have without your post. Thus, to me, you're a hero! :)

Thanks! :cool:
 
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